News & Media
SXM Airport Raises US$132 Million in Rated Bonds for Capital Improvement Program
Resurfacing of runway, additional aircraft parking, and relocation of fuel farm, among priorities
SIMPSON BAY, St. Maarten (January 13, 2013) - It was all smiles at the ceremonial closing of the US$132 million Princess Juliana International Airport (SXM) bond issue underwritten by Nomura Securities International Inc.
The closing was attended by a high-powered St. Maarten delegation led by Minister Romeo Pantophlet of Tourism and Economic Affairs, whose portfolios include the airport; and Finance Minister Roland Tuitt.
Speaking at the ceremony held at the offices of Nomura Securities International in New York on Thursday, January 10, 2013, both ministers thanked the team that made this historic bond issuance possible.
Minister Tuitt said the bond issue was good for St. Maarten, adding that it was precisely this that led him to finalize the official Moody's rating for the island. For his part, Minister Pantophlet said it would further facilitate the hub function of the island.
Acknowledging that the process was long and sometimes complicated, Patrick Quinn, managing director of Nomura Securities International Inc., said that Moody's rating had paved the way for the bond to be issued. He added that the fact that these bonds had not traded since they were offered reflects the purchaser's confidence in PJIA (SXM Airport). Quinn said Nomura was happy to underwrite the bonds for PJIA, one of the leading airports in the Caribbean.
Nomura is a Tokyo-based financial services group and global investment bank with regional headquarters in Hong Kong, London, and New York.
Nomura has operations in 18 exchanges all over the world and has held the number one position on the London Stock Exchange since 2007.
According to the Financial Times, in 2008, Nomura became the world's largest independent investment bank with Y20,300bn (£138bn) assets under management when it acquired Lehman Brothers business in the Asia-Pacific region and subsequently of its investment and equities portfolios in Europe and the Middle East.
Chairman of the Supervisory Board of Directors of PJIAE, Clarence Derby, speaking on behalf of the SXM Airport board said he was happy for the closing and thanked the St. Maarten government and in particular, the two ministers for their support from the very beginning. Also in attendance at the ceremony was the Chairman of the Princess Juliana International Airport Holding Company, Dexter Doncher.
The issuance of the bonds - and the fact that it was over-subscribed almost immediately - is without doubt a vote of confidence in the direction the Princess Juliana International Airport has chosen, and a resounding thumbs up for the stability of the economy of St. Maarten and for its leadership, which is very well represented here today, said Regina LaBega, PJIAE's Managing Director.
Not only is the Princess Juliana International Airport the first and so far the only company in St. Maarten to have rated bonds, and this huge amount of money was secured at very favorable terms of a fixed rate of 5.5% over 15 years. This is a significant decrease from the 8.25% interest rate obtained in the 2004 financing of US$118 million and a net savings of some US$10 million for the airport.
"There can be no better way to begin the New Year - and kick off the 70th anniversary celebrations of our Princess Juliana International Airport - than with the official closing of this bond issue that would permit the airport to diligently pursue its multi-million dollar Capital Improvement Program," LaBega said.
"We are starting a new era in the development of our airport, and consequently, the continued sustainability of St. Maarten's economic growth," she said in her address. "Every improvement we make at SXM Airport also means huge benefits for the economies of the surrounding islands of Anguilla, St. Barths, Saba, and St. Eustatius."
LaBega continued: "To take SXM Airport to new heights, the Capital Improvement Program which these bonds will finance include: resurfacing of the Airport runway; construction of taxi-ways in order to increase runway efficiency; expanding the aprons to provide additional aircraft parking during peak traffic periods; and relocating various facilities to improve the efficiency of the airport facilities and to provide for future growth."
Work on the rehabilitation of the runway is expected to commence in February 2013 and completed by August 2013. All work will take place overnight starting at 10 p.m. after the last flight operation of the day and end at 6 a.m. before the first flight of the day. No flight interruptions are expected.